Core Viewpoint - The article discusses the controversy surrounding Hong Kong insurance, particularly the claim by economist Lang Xianping that it is a "carefully designed scam," emphasizing the challenges in achieving a 7% stable return and outlining seven major pitfalls associated with it [1][3]. Summary by Sections 7% Return Controversy - The Hong Kong Insurance Authority has lowered the demonstration interest rate for participating insurance from 7% to 6.5% starting July 1, 2024, to prevent misinterpretation of returns [1]. - The 7% figure is not a guaranteed return but a non-guaranteed part of the demonstration interest rate, with clear distinctions required by regulators between hypothetical and actual returns [1][2]. Investment Perspective - Hong Kong insurance should not be viewed as a guaranteed profit-making financial product but rather as a medium to long-term asset allocation tool [4]. - Historical data shows that the median annualized return for policies held for over 20 years is 5.8%, although short-term volatility can lead to significant fluctuations [6]. Product Types and Market Trends - The current market for Hong Kong insurance is primarily divided into critical illness insurance and dividend-paying whole life insurance, with the latter becoming the dominant product type [8]. - Multi-currency dividend savings insurance is now the main product, offering features like currency conversion and policy splitting, making it suitable for wealth transfer and asset protection [9]. Consumer Insights - The motivation for mainland residents to purchase Hong Kong insurance has shifted from protection to asset allocation, driven by lower interest rates and a need for diversified investments [10]. - Hong Kong insurance may not be suitable for everyone, particularly those without cross-border needs, due to higher cognitive barriers and potential additional costs from currency fluctuations and legal differences [11]. Conclusion - Hong Kong insurance is not a scam but a financial tool shaped by legal environments, currency systems, product structures, and cross-border channels, suitable for individuals with clear long-term needs [12]. - The market lacks perfect insurance products, emphasizing the importance of understanding personal suitability before making investment decisions [13].

Investment Rating - The investment rating for AIA Group is maintained as "Buy" [8] Core Insights - In 2024, AIA Group reported a net profit attributable to shareholders of $6.836 billion, an increase of 84% year-on-year at constant exchange rates. The after-tax operating profit was $6.605 billion, and the new business value (NBV) reached $4.712 billion, reflecting a year-on-year growth of 7% and 18% respectively. The embedded value (EV) stood at $69.035 billion, up 4% from the beginning of the year. The final dividend was HK$1.31 per share, a 10% increase year-on-year, with total dividends for the year rising by 9%, in line with expectations [1][4] Summary by Sections Performance Overview - AIA Group's NBV growth rate for the full year decreased by 7 percentage points to 18% compared to the first half of 2024, but the absolute growth remains robust. The main driver was the new annualized premium income, which reached $8.606 billion, a 14% increase year-on-year. The new business profitability also improved, with the value rate increasing by 1.9 percentage points to 54.5% [2][3] Regional Performance - In 2024, the NBV growth rates for different regions were as follows: Hong Kong +23%, Mainland China +20%, Thailand +15%, Singapore +15%, Malaysia +10%, and other regions +18%. Hong Kong led with an NBV of $1.764 billion, achieving a 23% year-on-year growth, supported by strong growth in local and visitor business. Mainland China also saw a 20% increase in NBV, with new annualized premiums growing by 10% and the value rate rising by 4.9 percentage points to 56.1% [3] Investment Performance - By the end of 2024, AIA Group's total investment scale reached $288.621 billion, a 7.5% increase from the beginning of the year. The net and total investment yields for non-participating and surplus assets were 4.3% and 4.8%, respectively, remaining stable year-on-year. The net investment performance amounted to $3.610 billion, a significant increase of 133.4%, primarily due to reduced financial expenses related to insurance contracts [4] Shareholder Returns - AIA Group announced a new share buyback program of $1.6 billion, slightly increasing its shareholder return strategy. The expected completion of this buyback is within 2025, and based on the company's market capitalization at the end of the previous year, the dividend yield is approximately 6%, indicating an attractive return for shareholders [5] Profit Forecast and Valuation - Given the strong growth momentum in AIA Group's diversified business markets and the expected opening of new branches, the profit forecast has been revised upward. The projected net profit attributable to shareholders for 2025-2027 is expected to grow by 2.2%, 25.0%, and 10.4% respectively. The target price is set at HK$83.3, corresponding to a price-to-embedded value (PEV) of 1.5 times for 2025, maintaining a "Buy" rating [6]